Thursday, October 21, 2010

Note: This article was originally published in THE GLOBAL FUTURIST blog.

Dear Readers:

Marketing has all but ceased to involve relationships and two-way communications (personalities aren't conveyed too effectively by an automated "press a number" answering service, or in a 140-character social media status update, i.e., Twitter Litter), and has become a matter of shouting about a product or service and then having an operational protocol for fulfillment. The salesmanship has been leached out; the friendship and familiarity between account representative and client has largely been replaced (inadequately) by automation; the Humanity of the process, the relationship between two or more Human Beings to finalize commerce has been minimized.

As a result, customer and client satisfaction with many companies and brands is very poor and getting worse. Loyalty and retention suffer in these hyper-automated companies because people have a hard-wired, deep-seated need to be in personal contact with other people. If you have a captive client base (as in the case of any government-blessed utility or other monopoly), your clients have no choice but to use your services. They are handed to you -- and you are probably abusing, overcharging and underserving them -- if they could leave you, they would. But most emerging enterprises and non-monopolistic businesses, are fighting harder and harder to gain market share because they do not have a persona.

The companies in the small to medium-sized entrepreneurial market sector are merely burning eachother's margins down, and creating an increasing population of discontented, angry and frustrated customers. These people want to speak with a person who knows them, will listen to them, and be personally responsive to them.

The Human Factor will be a major determinant of success in acquiring and retaining market share in the near future. Since it has become so rare, it will actually be re-introduced as an innovative new way to conduct business. Look for the companies that are returning to a person-to-person customer services and marketing model, and you will see the new leaders in their respective spaces.

People want to be greeted by other people; assisted by other people; listened to by other people -- and they have become increasingly desperate for longer-term, dependable, predictable and comfortable "business friendships" with other people. The consumer market is quitely desperate for communion with their commerce -- and the companies that are willing to re-Humanize in order to provide that "personal touch" are going to grab large chunks of market share.

China Is Making The Rare Earth Elements Rarer - This Is The Furtherance Of An Expanding (And Expansionist) Trend

Dear Friends:

As Delilah is said to have replied to Sam(p)son [the "p" is silent] when he asked why she had betrayed him with a nefarious nocturnal crewcut (knowing full well that his long locks were the source of his strength), "Darling, how could you have given me such great power and expected me not to use it?"

He probably knew by her response that 1) they would not be "an item" for very long, and 2) that when you give people power (in this case, telling her the secret source of his legendary strength), they will generally make use of it -- if not for some evil end, just for the sake of experimentation.

The Chinese have had their growing economic and political power reaffirmed publicly by the global community, just as the other members of the global community are confessing to one another (with China listening but trying not to smile) about all of their economic problems, areas of need, fears and shortages. China is, as one might expect, is feeling the exhilaration of acknowledged power and is flexing its muscles internationally. This is a typical and traditional show of power.

Recently, as it has become increasingly apparent that the Rare Earth Elements are growing in demand and shrinking in supply, China has exploited this information by curtailing its exports of REEs to Japan, and by quietly but steadily closing off the spigot of supply to Europe and to the United States.

The result will likely be an rapidly growing increase in the value and pricing of the Rare Earth Elements (learn more about them at http://ThoriumEnergyInc.blogspot.com) and a growing international hostility (actually a combination of envy of China's fiscal health and resentment of the dependency on the part of so many nations upon China's consumerism and resources).

Expect further chest-thumping on the part of China, and growing fear, insecurity and resentment of China by its G-20 counterparts. We are headed for the Global domination of the World by China during the course of the next several years. And of course, the more dominant the Chinese become the more they will be hated.

This makes me nostalgic for the early 1990s in the United States.

In the longer-term, China will likely push hard enough to inspire some productive reform in the economies of the other "once great" nations; but until that time, expect a great deal of business to be centered about China (out of temporary necessity), but for an almost palpable bitterness toward the country and its culture.

China Said to Widen Its Embargo of Minerals

HONG KONG — China, which has been blocking shipments of crucial minerals to Japan for the last month, has now quietly halted some shipments of those materials to the United States and Europe, three industry officials said this week.
The Chinese action, involving rare earth minerals that are crucial to manufacturing many advanced products, seems certain to further intensify already rising trade and currency tensions with the West. Until recently, China typically sought quick and quiet accommodations on trade issues. But the interruption in rare earth supplies is the latest sign from Beijing that Chinese leaders are willing to use their growing economic muscle.
“The embargo is expanding” beyond Japan, said one of the three rare earth industry officials, all of whom insisted on anonymity for fear of business retaliation by Chinese authorities.
They said Chinese customs officials imposed the broader restrictions on Monday morning, hours after a top Chinese official summoned international news media Sunday night to denounce United States trade actions.
China mines 95 percent of the world’s rare earth elements, which have broad commercial and military applications, and are vital to the manufacture of products as diverse as cellphones, large wind turbines and guided missiles. Any curtailment of Chinese supplies of rare earths is likely to be greeted with alarm in Western capitals, particularly because Western companies are believed to keep much smaller stockpiles of rare earths than Japanese companies.
China experts said on Tuesday that Beijing’s assertive stance on rare earths might also signal the ascendance of economic nationalists, noting that the Central Committee of the Communist Party convened over the weekend.
A few rare earth shipments to the West have been delayed by customs officials in recent weeks, said industry officials in China, Japan and the United States. But new restrictions on exports appear to have been imposed on Monday morning.
Industry executives said there had been no signal from Beijing of how long rare earth shipments intended for the West would be held by Chinese customs officials. A few shipments are still being allowed out of the country for reasons that remain unclear: a fourth rare earth industry official said on Wednesday that one of the 32 authorized rare earth exporters in China had been allowed to export one container of rare earths to the West on Tuesday and hoped to be allowed to ship another on Thursday.
China’s official stance remained unclear on Wednesday. In an apparent reference to a report on Tuesday in the official China Daily newspaper, the commerce ministry said the report, predicting a decline of up to 30 percent in rare earth export quotas next year, was “totally groundless and purely false,” and added that no decision had been made yet on future quotas.
Without mentioning whether customs officials were interfering with statements to the West this week, the statement also said that, “China will continue to export rare earth to the world, and at the same time, in order to conserve exhaustible resources and maintain sustainable development, China will also continue imposing relevant restrictions on the mining, manufacture and export of rare earths.”
Japan’s Kyodo news agency reported on Wednesday that an unidentified diplomatic source in Beijing had said that rare earth shipments to the United States and Europe were being held up by customs officials for tighter inspections, one of the explanations that customs officials have also given in blocking shipments to Japan for the past month. But John Clancy, the trade spokesman for the European Commission, said in a statement on Wednesday that, “at this time, we cannot confirm claims made by European industry officials in media reports of China blocking rare-earth shipments to the” European Union.
The signals of a tougher Chinese trade stance come after American trade officials announced on Friday that they would investigate whether China was violating World Trade Organization rules by subsidizing its clean energy exports and limiting clean energy imports. The inquiry includes whether China’s steady reductions in rare earth export quotas since 2005, along with steep export taxes on rare earths, are illegal attempts to force multinational companies to produce more of their high-technology goods in China.
Despite a widely confirmed suspension of rare earth shipments from China to Japan, now nearly a month old, Beijing has continued to deny that any embargo exists.
Industry executives and analysts have interpreted that official denial as a way to wield an undeclared trade weapon without creating a policy trail that could make it easier for other countries to bring a case against China at the World Trade Organization.
So far, China seems to be taking a similar approach in expanding the embargo to the West.
Wang Baodong, a spokesman for the Chinese Embassy in Washington, said on Tuesday that the Chinese government was putting new restrictions on the mining, processing and export of rare earths to protect the environment. But he said that China was not violating any W.T.O. rules in doing so and that it was not imposing an embargo or trying to use rare earths as a bargaining chip.
“With stricter export mechanism gradually in place, outbound shipments to other countries might understandably begin to feel the effect,” Mr. Wang said in an e-mail. “But I don’t see any link between China’s reasonable rare earth export control policy and the irrational U.S. decision of protectionist nature to investigate China’s clean energy industries.”
Nefeterius Akeli McPherson, a spokeswoman for the Office of the United States Trade Representative in Washington, said that American trade officials were looking into the matter, after a report of the Chinese customs restrictions was published on Tuesday afternoon on the Web site of The New York Times.
“We’ve seen the news report and are seeking more information in keeping with our recent announcement of an investigation into whether China’s actions and policies are consistent with W.T.O. rules.”
Jeremie Waterman, the China director of the United States Chamber of Commerce, said that he was still checking government and industry sources to learn the extent of a suspension of Chinese rare earth shipments. “If it’s true, it’s disturbing news to say the least,” he said.
Mr. Waterman said that rare earths were so important to advanced manufacturing that restrictions on their trade might need to be put on the agenda of the Group of 20 meeting of heads of state, scheduled next month in Seoul, South Korea.
The Chinese government office that oversees rare earth policy, which operated with considerable independence for many years, was moved early last year into the Ministry of Industry and Information Technology. That ministry, formed only two years ago to draft plans for global leadership in many industries, has emerged as a bastion of economic nationalism.
Despite their name, most rare earths are not particularly rare. But most of the industry has moved to mainland China over the last two decades because of lower costs and steeply rising demand there as clean energy industries have expanded rapidly.
Congress is considering legislation to provide loan guarantees for the re-establishment of rare earth mining and manufacturing in the United States. But new mines are likely to take three to five years to reach full production, according to industry executives, although existing uranium mines may be able to move faster by reprocessing previously mined material, which often contains rare earths.
China reduced in July its export quota for rare earths for the second half of the year by 72 percent. Exporters had only six weeks’ of quotas left when China imposed its unannounced embargo on shipments to Japan.

I am learning that it is best to keep things as simple as possible. In our politically correct society, no person is unintelligent or narrow-minded...not at all! The wonderful chap or lady who appears "unintelligent" just "learns and processes information differently" than his or her seemingly "brighter" peers. The swell fellow or gal who appears ("presents," symptomatically speaking) narrow-minded is either "misinformed", or has had his or her perspective "challenged" or "unusually shaped" by a "limited experiential environment." His or her respective peers should encourage them to share their simplistic and refreshingly narrow focus on various issues about which they have no knowledge. Besides, knowledge corrupts the pure, unwrinkled mind and makes it prone to opinionation. [collective gasp]

We, as a species are only as good as our weakest link -- being politically correct means that we simply recalibrate our foolishly unrealistic standards and let the lowest common denominator set the pace for all of us. I have been uppity for too long, and I am ashamed.

These people should not be the objects of my criticism, or of yours. We are all of equal worth and quality, but like the beautiful snowflakes that fall in the wintertime, each one of us is fabulously "unique." There is no better and no worse. There is no basis upon which we can differentiate any one of us from any other one. Each of us serves a special and equally meritorious purpose:

The fast-driving litterer who tosses the remains of his fast-food takeout lunch out of his car window provides employment for the roadside sanitation engineer! The burglar provides employment for the police detective! Symbiosis!

There is no difference between a spoonful of poodle excrement and a scoop of chocolate ice cream, except, perhaps, the taste. Both are excellent -- arguably (but why argue?) -- but a person accustomed to one flavor must educate his or her palate to "acquire" a taste for the other. Judgment limits us. Think of the possibilities. What a wide, diversified world. What a panoply of potential we have here. Uncle Fester and Albert Einstein. The princesses and princes of the Jersey (pronounced "Joisey") Shore (pronounced "Shaw), and the crowd at Beverly Hills. Tim Gunn and Peter Luger (irony intended). It's a party...

Further, we are all victims of something or other...in fact this "victimhood" status binds us together -- the child molester and the elderly woman who works in the school cafeteria -- the axe-murderer and the Eagle Scout -- the crack peddler and the Wall Street CEO --- we are truly all the same. To differentiate by using a system of "ranking" or "value" would be an act of bigotry. We should learn to live as one big happy family. Objectivism and other such philosophies are archaic and hopelessly useless: they foster competition, ambition, and divide us. [please pause for a moment while I swallow some Soma, prescribed by my physician at the clinic, Dr. Orwell]

In the musical but slightly sexist (and you'll see why!!!) words of Ray Stevens..."Everybody's beautiful/ in his own way."

Having said this, I hope you will indulge me whilst I express my personal view (no better or worse than anyone else's) regarding some of the "potential outcomes" associated with interactions between small businesses and various types of financial institutions.
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I apologize for the lengthy preamble (if you read it). Off the record (heh-heh), I believe that there actually are unintelligent and bigoted people. I would just never dare to put it into writing.

Recently, someone in a business networking group (I will not specify whether or not it was Linked In, because there are some terrific and resourceful Human Assets there), a member made several observations (ill-informed assumptions, but his opinion, nonetheless) about one of the two TNNWC financing programs mentioned in the title. Both were highly negative comments if taken out of perspective. I'll paraphrase the criticisms:

1) "Any financing program or organization which charges an application or processing fee is obviously either incapable or a scam."

2) "I could just go to my bank to get a loan for my business without paying any fees. What would I need you for?"

The third one, which was implied, was that:

3) "I can go to an investment banker or venture capitalist and get my money without using an intermediary or paying any fees."

So there. I'd like to address these bothersome statements with several of my own. My statements will not be *politically correct*, so you might find them disturbing.

1. If you can go to your bank and get a loan to facilitate your needs, you certainly do not need our services. If you aren't charged any processing fees, appraisal fees, highly-conditional commitment fees and a host of other charges (before you receive a dollar of proceeds, which you may not receive), you are indeed a shrewd negotiator. Good luck.

2. If you can go to a venture capitalist to invest directly in your business, or if you can get an investment banking firm to underwrite shares, bonds or other securities in your company, you certainly do not need TNNWC's services. If you can do so without a due diligence fee, underwriting fee, consultative fee (again, before you've received a dollar of proceeds, which you may not receive), you a quite an operator. Good luck.

3. TNNWC is certainly not a substitute for either of the above if you can simply pick up the telephone, or get on a plane and just get your money. All we do at TNNWC for your company is some data collecting, due diligence, evaluation and analysis, packaging, presenting (to actual, pre-qualified and suitable providers of funds), help with negotiations and act as your consultant and advocate. And there are fees. They are justified because performs serious work and adds serious value -- and we save you the thousands of dollars and person-hours you would have to expend if you were to go DIY money-shopping. What's more, you'd be doing the process by trial and error, and dropping your limited funds all of the way.

4. Sadly, most banks don't want to make any loans at all, least of all to new. small or growing businesses. Ditto for investments by most VCs and investment bankers.

5. Your company must be presented in the proper way to the proper sources -- sometimes we must find your hidden "gold nugget" and polish it up for you; sometimes, if your industry is good and your prospects for growth are a good bet, you may lack appeal because you seem "ordinary." In cases like this, we have to "put lipstick on the pig" (no insult intended to non-high-tech companies or pigs).

6. If your attorney, CPA or other financial professional (who should, of course, work for your company on a contingency fee basis -ahem-) can find you the financing that you need, don't waste any time with TNNWC's Programs. In fact, try to get any person or firm you regard as "professional" (excluding personal injury law firms that advertise on television and promise no fee, but actually charge you "expenses") to work on a strict contingency basis...if you can, then you've certainly taught me a lesson.

7. If you can find a "money broker" or other "finder" who will offer to take your company directly to the land of money, absorb all of the incident expenses himself or herself, and ask that you pay a "commission" only upon a successful closing, you are either not dealing with a professional (odds are that he or she is in the mass-mailing business, and your financing request will be shown around like the orphaned child that no relative will take), or you are dealing with someone who will not invest any time trying to get your financing at all.

8. In the current economy, financing for companies which are new or which earn $1.0 million to $100.0 million per year is extremely tough, and turns out to be very, very expensive and discouraging -- usually leaving you poorer and with less time to focus on operating your business itself. Obtaining financing is a challenging, daunting task, and is greatly expedited by the use of the right strategic, value-added intermediary to present your company to only the proper sources in the proper light with the best possible financing structure.

9. TNNWC does not solicit companies. They will come to us if they either know the economic environment (and its pitfalls), or have made some false starts with some banks, VC's and investment bankers, none of whom is likely going to wine and dine you for the opportunity to acquire you company's business. In this economy, and in the one to come, bankers will be looking for deposits and fee income (taking no credit risk), VCs will be looking for a company that will be the next Google (with a multibillion-dollar exit strategy), and the large Wall Street Firms will be involved in multi-billion dollar deals, and in collecting giant advisory fees.

Bottom Line:

*Politically Incorrect* though it is to say this, entrepreneurial start-ups, emerging enterprises, small and growing businesses and other very legitimate powerhouses of productivity have become either invisible or irrelevant to the ever-distant institutional financial community. They are "too big to fail." You are not.

If you need us, we'll make ourselves available. We demand full disclosure. We will evaluate you, and give you the real story. If we can't help you, your risk is temporally and financially small, and we'll let you know about the alternatives -- or we'll just refer you out.

We have a unique and and intelligent approach to getting your financing together. If anybody says that you don't need us, please ask him or her (be insistent!) to assist you in getting the capital that you require.

The fact is that getting financing requires expert, highly-specialized targeted marketing. Capitalizing businesses for operations and growth is only getting more difficult. It takes professional skills and sincere effort to get money. You probably need someone on your side.

Rare metals shortage could blunt gadget growth

By Michael Kan

October 6, 2010 07:15 AM ET

IDG News Service - Imagine a cellphone the size of a shoe. Or a laptop weighing 10 kilograms.

That's what we would be carrying around today, if not for the rare earth metals, a group of materials with unique properties that have enabled the miniaturization of electronic components including capacitors, lasers and powerful magnets.
From computer hard drives to hybrid cars, many of today's high-tech devices rely on components made with rare earth metals to properly function. But demand for those metals is beginning to outstrip supply, forcing governments and manufacturers to find new sources of raw materials.

The rare earths are a group of 17 metals including neodymium, used in magnets, and erbium, used in lasers.

Countries such as the U.S. have long possessed their own sources for rare earth metals, but despite this they have turned for their supplies to China, where mining costs have been cheaper and environmental rules more lax. This has made China the world's largest producer of rare earth metals, mining more than 90 percent of global demand, analysts say.
China's tightening control over supplies became apparent last month when media outlets reported that it had stopped exports of rare earth metals to Japan following a diplomatic spat between the two countries.

"What China's action has done is create uncertainty," said Dudley Kingsnorth, a rare earth metals expert at the Industrial Minerals Company of Australia. "Undoubtedly people will diversify their sources of supply to reduce their reliance on China. But that can't happen overnight."

Japan, a major importer of rare earth metals, is actively exploring for new sources in Canada and Australia, as well as looking into recycling old electronic devices as a way to create new supplies of the materials.

The U.S. Congress is working on legislation, passed by the U.S. House of Representatives last week, to revitalize U.S. sources of rare earths. But China's dominance over the rare earths market will likely continue for the next two to three years, as manufacturing firms are forced to depend on limited supplies and dip into their stockpiles, Kingsnorth said.

Demand for the rare earths has long been expected to accelerate. Some projections suggest that demand could nearly double by 2015, with hybrid car engines and wind turbines big drivers behind the need.

Looking narrowly at costs, a shortfall in rare earth metal supplies might mean just a minimal price hike, or no increase at all, for the electronic gadgets that use them, analysts say. This is because many of these products only contain tiny quantities of rare earth metals.

"Something like a laptop computer probably only has got about 50 to 80 cents' worth of rare earth in it," Kingsnorth said. "Even if that tripled in price, it won't stop people from buying it." ####

Observation from Douglas Castle: Without these REEs, much of present and planned future technology would be impossible. The fact that REEs only constitute a small percentage of the price of technologies. If supplies should become inaccessible, or if the market were to become dominated by a handful of players/investors, The Rare Earth Elements would become more expensive per ounce than gold. Start thinking ahead.

Friday, October 8, 2010

"Patients grow tired of being victims, and start wanting to make their own choices when physical reality and fiscal consequences come together. Necessity tends to inspire innovation in both individuals and industries. When it comes to survival, both individuals and industries have to either find or create alternatives when they are left to fend for themselves." - Douglas Castle

THE GROWING U.S. HEALTHCARE CRISIS AND... THE RISE OF "DESTINATION HEALTHCARE."

At present, in the United States and in an increasing number of industrialized and even non-industrialized nations, there is a hospital-based healthcare crisis that will be imperiling the quality of all hospital-provided healthcare during the next three years. As you would suspect, it is attributable to that sad, inappropriate ordering of priorities -- profits, first...patients, second -- that will precipate one of the biggest hospital-based healthcare quality declines in world history.

The United States is leading the way in terms of increasing expense, increasing waste, increasing the number and frequency of unnecessary but potentially dangerous procedures on patients, gross mismanagement of funds and an acute but unaddressed lack of adequately trained and managed professional and non-professional staff. Many other countries are following a similar path, but are not falling apart at the seams to the extent that we are.

Background:

Hospitals are capitalized through a combination of sources, excluding the religiously-affiliated "special cases". These sources of capital include: endowments from wealthy donors, board members and trustees; investment by big pharmaceuticals companies (usually to collect data for FDA clinical trials or other regulatory approvals, or to to promote the use of their drugs at the optimal point of sale, i.e., either by the staff physicians and surgeons performing procedures, and by the referring physicians in private practice who send patients to the hospitals); investment by medical device companies (usually to collect data for FDA or other regulatory approvals; educate and assist surgeons and other professionals in the use of new technologies, encourage the aggressive use of their equipment by professional staff, and to outshine [via "generosity"] competitors within their market by a constant presence on the "field of battle"); third-party reimbursement (payments for procedures from either insurance companies or from Medicaid and other reportedly wasteful government-run enterprises).

As these money sources dry up due to a beseiged economy, and as hospitals are rapidly losing their profit margins due to an ever-accumulating proliferation of poor management practices, those few "surviving hospitals" may be doing an increased amount of sophisticated maneuvering (this actually brings to mind the dishonorably demised Enron Corporation and its co-conspiring auditors, the late Arthur Anderson and Company, although there is admittedly, a line between the "aggressive" practice of medicine or undertaking of procedures and the "abusive" or fraudulent practice of medicine) which will, of course, adversely impact the quality of patient care as it drives up the expense of an average procedure or hospital stay.

This year, U.S. employers have reported that their healthcare insurance costs for covered employees have increased 8.3% since the passage of ObamaCare. It has been projected by the pundits that the insurance companies (who are seldom denied an increase in premium rates if they offer any explanation at all), bracing for the nation of covering an increasing population of formerly "ineligible" employees and their family members, are going to be kicking premiums up by another 18% to 22% by the end of 2011.

Of course, these costs will be passed along to employers (who will not be able to employ as many full-time individuals as they might otherwise have), the poor and unemployed (who will be required, by law to have health insurance), and the providers of healthcare, who will have to be a bit more clever in terms of coding procedures for reimbursement, and who may have to be a good deal more creative (not meant in a positive way) in diagnosing, testing and treating patients.

Of course, the insurance companies, long engaged in the indirect corporate practice of medicine, will dictate to the doctors and the hospitals which procedures are "necessary" and which are "not," (by their willingness to reimburse or pay for a procedure) as well as how long a patient should remain in the hospital until he or she is miraculously (or otherwise) sufficiently healed or rehabilitated to head back to work at the quarry.

Ultimately, at the end of this chain of buck-passing, all of the money required to save US hospitals from their current (and steepening) financial problems will have to come from the patients and the taxpayers-at-large. Procedures will increase in expense; premiums will increase in expense; the quality of patient care will continue to suffer.

The industry that might benefit is now categorically referred to as Destination Healthcare, (it had previously been referred to as "medical tourism" among other terms) an arrangement where a specialized company helps a patient (or that patient's caregiver) to locate a suitable practitioner, in a suitable hospital, and in a suitable country outside of the US (for example, China, Taiwan, Singapore, India, etcetera) where the procedure can be performed at comparable or better quality than in the US, but at a significantly lower price. If you were to marry the tourism and healthcare industries, the couple's likely offspring would be some variant of Destination Healthcare.

In certain cases, US-based medical insurers will even cover the cost of treatment and procedures done outside of the US -- the potential benefit to these insurers is the decrease in the dollar amount of payouts on patient claims; but they do bear an increased exposure to lawsuits and large payouts if things don't work out for any reason.

In other cases, a patient or caregiver may determine that even if a procedure to be performed outside of the United States is not reimbursable through their healthcare plan, it is still cost-effective to have the procedure done with payment out-of-pocket. Given quality of patient care and aftercare considerations, the decision regarding whether or not to look into the possibility of Destination Healthcare is becoming an increasingly common one as the public becomes more aware of this alternative.

That's right -- as money gets tighter in the US, and as having medical procedures performed and aftercare or therapy provided becomes an increasingly wide and short road to personal insolvency, I would project a significant increase in the visibility, activity and profitability of these specialized Destination Healthcare firms. While The Global Futurist does not provide any investment advice, it would seem that the companies providing this service will be getting an increasing share of the total United States healthcare market.

Healthcare, as in the case of too many things, has now become a commodity, and price-shopping is going to be on the rise as consumers (patients) become a bit better-educated and less prone to victimization at the hands of a healthcare system that is all too often putting the Oath of Hippocrates aside in order to sustain profits through an unspoken "Oath Of Hippocrisy."

The news items which follow were aggregated and published on October 2nd by Yahoo! from a variety of mainstream media sources. I take no credit for any of the content, and I have reproduced it here in true form, without editing, redaction or technological trickery.

While the news items themselves are of considerable interest and cover a wide range of topics, from professional sports to a political prisoner of conscience (the Chinese sometimes refer to people such as these as "dissidents" whereas in ancient Greece they might have been called "great thinkers" or "philosophers" -- but then again, there was that hemlock incident with Socrates) who is to be awarded a Nobel Prize for his brilliant work... if you look at each of these items they are fascinating.

But more importantly, if you look at the worldview built upon the aggregation of all of these items, it seems either comical or tragic (or perhaps both) that we seem to be living in a time where things just do not make any sense.

These are times of biting irony, ideas and laws carried to senseless extremes, and a public dominated by a media atmosphere comprised of an incongrous mix of low-budget (but enormously successful) "reality" shows; advertisements with such high-speed, roller-coastering imagery that you cannot figure out what product, service or brand is being promoted (perhaps there are some subliminal cues); stories of incredible fraud and corruption (which are creating such sensorial fatigues that most people just say "ho-hum"); threats of annihilation any day now, caused by any number of possibilities, from terrorists with nuclear weapons, to increasingly virulent strains of diseases, to radical climatic change.

The not-so-silly bottom line is that people are being overloaded by all of this fast-breaking information to the point of resigned enslavement. The muscles and joys of the imagination, stimulating conversation (without interruptions every minute from cell phone calls and text-message alerts), and simple quietude and contemplation are rapidly atrophying and even vanishing --- living is being replaced by functioning.

Most of the world's populace has neither the time (all of it is consumed with high-velocity messaging, worrying about the next next task while screwing up the one being performed at that moment, juggling too many obligations), nor the inclination (we are too tired to think, so we resort to media or games in order to block out the burden of any more thinking and doing) to do any living in the present moment - the notion of genuine relaxation (just as the notion of retiring comfortably on your pension) and the enjoyment of just passing the time with a hobby, with a casual conversation, or in the act of truly existing consciously in the fleeting magic of the present moment, is disappearing.

My fear is that we are becoming increasing robotic - and far less Human. The joy of doing a defined job, playing a defined role, and enjoying leisure is fading fast. If we don't remove ourselves from the noise, clutter, litter and ever-increasing complexity of our lives, our lives might not any longer be worth living.

One factor evidencing this saddening trend is that suicides among college-aged youth and Baby Boomers are increasing at an incredible pace throughout the world.

Why would so many people wish to end their lives if they could still experience joy? There is a crisis here -- our species is doing something that is contrary to what we once thought was a general rule governing all living creatures -- that is the hard-wired "need" or "propensity" to live, to grow and to reproduce.

Don't laugh -- I believe that we are exterminating ourselves as we cease to act like living organisms and try, with increasing commitment, to be robotic.

We might be drawing frighteningly close to the end of the Human Experience.

More frightening than killing each other, we are increasing opting-out of a life that is more painful than promising. And that breaks my heart.

Wednesday, October 6, 2010

"Patients grow tired of being victims, and start wanting to make their own choices when physical reality and fiscal consequences come together. Necessity tends to inspire innovation in both individuals and industries. When it comes to survival, both individuals and industries have to either find or create alternatives when they are left to fend for themselves." - Douglas Castle

THE GROWING U.S. HEALTHCARE CRISIS AND... THE RISE OF "DESTINATION HEALTHCARE."

At present, in the United States and in an increasing number of industrialized and even non-industrialized nations, there is a hospital-based healthcare crisis that will be imperiling the quality of all hospital-provided healthcare during the next three years. As you would suspect, it is attributable to that sad, inappropriate ordering of priorities -- profits, first...patients, second -- that will precipate one of the biggest hospital-based healthcare quality declines in world history.

The United States is leading the way in terms of increasing expense, increasing waste, increasing the number and frequency of unnecessary but potentially dangerous procedures on patients, gross mismanagement of funds and an acute but unaddressed lack of adequately trained and managed professional and non-professional staff. Many other countries are following a similar path, but are not falling apart at the seams to the extent that we are.

Background:

Hospitals are capitalized through a combination of sources, excluding the religiously-affiliated "special cases". These sources of capital include: endowments from wealthy donors, board members and trustees; investment by big pharmaceuticals companies (usually to collect data for FDA clinical trials or other regulatory approvals, or to to promote the use of their drugs at the optimal point of sale, i.e., either by the staff physicians and surgeons performing procedures, and by the referring physicians in private practice who send patients to the hospitals); investment by medical device companies (usually to collect data for FDA or other regulatory approvals; educate and assist surgeons and other professionals in the use of new technologies, encourage the aggressive use of their equipment by professional staff, and to outshine [via "generosity"] competitors within their market by a constant presence on the "field of battle"); third-party reimbursement (payments for procedures from either insurance companies or from Medicaid and other reportedly wasteful government-run enterprises).

As these money sources dry up due to a beseiged economy, and as hospitals are rapidly losing their profit margins due to an ever-accumulating proliferation of poor management practices, those few "surviving hospitals" may be doing an increased amount of sophisticated maneuvering (this actually brings to mind the dishonorably demised Enron Corporation and its co-conspiring auditors, the late Arthur Anderson and Company, although there is admittedly, a line between the "aggressive" practice of medicine or undertaking of procedures and the "abusive" or fraudulent practice of medicine) which will, of course, adversely impact the quality of patient care as it drives up the expense of an average procedure or hospital stay.

This year, U.S. employers have reported that their healthcare insurance costs for covered employees have increased 8.3% since the passage of ObamaCare. It has been projected by the pundits that the insurance companies (who are seldom denied an increase in premium rates if they offer any explanation at all), bracing for the nation of covering an increasing population of formerly "ineligible" employees and their family members, are going to be kicking premiums up by another 18% to 22% by the end of 2011.

Of course, these costs will be passed along to employers (who will not be able to employ as many full-time individuals as they might otherwise have), the poor and unemployed (who will be required, by law to have health insurance), and the providers of healthcare, who will have to be a bit more clever in terms of coding procedures for reimbursement, and who may have to be a good deal more creative (not meant in a positive way) in diagnosing, testing and treating patients.

Of course, the insurance companies, long engaged in the indirect corporate practice of medicine, will dictate to the doctors and the hospitals which procedures are "necessary" and which are "not," (by their willingness to reimburse or pay for a procedure) as well as how long a patient should remain in the hospital until he or she is miraculously (or otherwise) sufficiently healed or rehabilitated to head back to work at the quarry.

Ultimately, at the end of this chain of buck-passing, all of the money required to save US hospitals from their current (and steepening) financial problems will have to come from the patients and the taxpayers-at-large. Procedures will increase in expense; premiums will increase in expense; the quality of patient care will continue to suffer.

The industry that might benefit is now categorically referred to as Destination Healthcare, (it had previously been referred to as "medical tourism" among other terms) an arrangement where a specialized company helps a patient (or that patient's caregiver) to locate a suitable practitioner, in a suitable hospital, and in a suitable country outside of the US (for example, China, Taiwan, Singapore, India, etcetera) where the procedure can be performed at comparable or better quality than in the US, but at a significantly lower price. If you were to marry the tourism and healthcare industries, the couple's likely offspring would be some variant of Destination Healthcare.

In certain cases, US-based medical insurers will even cover the cost of treatment and procedures done outside of the US -- the potential benefit to these insurers is the decrease in the dollar amount of payouts on patient claims; but they do bear an increased exposure to lawsuits and large payouts if things don't work out for any reason.

In other cases, a patient or caregiver may determine that even if a procedure to be performed outside of the United States is not reimbursable through their healthcare plan, it is still cost-effective to have the procedure done with payment out-of-pocket. Given quality of patient care and aftercare considerations, the decision regarding whether or not to look into the possibility of Destination Healthcare is becoming an increasingly common one as the public becomes more aware of this alternative.

That's right -- as money gets tighter in the US, and as having medical procedures performed and aftercare or therapy provided becomes an increasingly wide and short road to personal insolvency, I would project a significant increase in the visibility, activity and profitability of these specialized Destination Healthcare firms. While The Global Futurist does not provide any investment advice, it would seem that the companies providing this service will be getting an increasing share of the total United States healthcare market.

Healthcare, as in the case of too many things, has now become a commodity, and price-shopping is going to be on the rise as consumers (patients) become a bit better-educated and less prone to victimization at the hands of a healthcare system that is all too often putting the Oath of Hippocrates aside in order to sustain profits through an unspoken "Oath Of Hippocrisy."

It would seem that there is mixed news to report, and some unsettling possible implications for the near-term (the next 18 months) which will impact every homeowner, selling homeowner and prospective home buyer...not to mention the US economy-at-large and, to a lesser degree, the economies of other industrialized countries in Europe.

A recent article published by Truthout (a publication of BuzzFlash Media) indicates that an increasing number of major US and international banks with mortgages (or which are invested in the mortgage-backed securities produced by the process called "securitization") are ceasing or indefinitely postponing foreclosures.

"Why are they doing this?" you may ask. It is certainly not out of clemency or decency -- it is because of a great number of legal irregularities, fraudulent actions, and a shipload of other complications relating to the way in which the banks, their servicers and their third-party securitization agencies (a Wall Street Family-type affair) created the mortgages, packaged the mortgages, re-sold the mortgages, abused the mortgagors (the people in debt), and went about the business of trying to recover some of their losses by seizing the assets which they thought collateralized their loans and selling them off. Many law firms ("mortgage mills") have played a role in the these slapdash, illegal and downright unconscionable fraud. Some many parties profited at so many different levels -- all at the cost and peril of the consumer.

For a time, at least, for this whole cast of characters, crime certainly did pay. It was not really finance; it was sophisticated, systematized thievery. The US consumers will ultimately pay (AGAIN) for the excessive arrogance, gluttony and greed of "banks" and "investment banking houses".

We all know that if a bank is stuck with a large portfolio of non-performing mortgages (and all of the large banks are), and can't get rid of them "hot-potato" style by selling them to some government agency, passing them off like counterfeit bills to other banks, or by foreclosing on them and reselling them to recover some percentage of of their losses, they are in deeper trouble than ever before.

What you'll hear: "Bank foreclosures are slowing down, and many banks are delaying foreclosure proceedings!" "YAY!"

What Douglas Castle says: "Banks are in far worse shape than had been previously thought, and the availability of financing for new and used home purchases will be further stoppered up, further cratering the home sales market, home prices and further steepening and prolonging the profound economic recession in the US." "NAY".

The banks are going to be screaming for another bailout or legal relief, as an increasing number of homeowners are taking them to court, title companies are refusing to issue title insurance, and other participants in the process are becoming frightened and frozen. The banks brought this upon themselves.

The question is, in what manner will the US government try to "fix" this new revelation? Just imagine....banks unable to foreclose.

Here's what to do...

First, read the article. Second, enjoy the video. Third, read what I believe that the near-term issues will be -- near-term issues affecting every single one of us.

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Shock Therapy for Wall Street: JPMorgan Suspends 56,000 Foreclosures; GMAC and BOA Many More
Ellen Brown, WebofDebt.com: "On September 28, JPMorgan Chase said it was halting 56,000 foreclosures because some of its employees might have improperly prepared the necessary documents. All of the suspensions were in the 23 states where foreclosures require court approval."

1) A deepening credit crunch from all conventional lending sources, with stiffer credit criteria and more draconian documentation required than ever before. Simply put; no re-negotiated terms, no new mortage funds for mortals, no refinancings, more unemployment in the banking services sector, even poorer customer service (if this is actually possible). Banks are all but completely out of the lending business, as will be most consumer loan financing companies, except the ones which are captive or dedicated to the financing or leasing of automobiles.

2) A cutback in all conventional lending activities;

3) Increases (despite the consumer-protection laws) in all types of non-loan related banking fees, in true predatory fashion, to make up for some of these losses and to create some income and liquidity, especially in terms of credit cards and other bank "services" and "privileges."

4) Further declines in home values due to the absense of credit to facilitate liquidity in the market;

5) Downward pressure on the price of major publicly-traded bank stocks; not to worry, though...those executive bonuses being paid to these too-big-to-fail fraudsters will continue and will increase;

6) A further decline in the value of the US dollar versus other currencies;

7) A decline in the sovereign debt rating of the United States;

8) More money finding its way out of the US banking system and securities markets into alternative and less-known investments involving, ETFs ("exchange-traded funds"), physical gold, foreign currencies, and direct participations in select entrepreneurial deals (cash flow generating private placements, and similar arrangements).

I wish that I had better news.

The silver lining: If your bank forestalls a foreclosure on your home, you will enjoy the basic benefit of shelter for a while longer.